Every product, goods, or service is an example of a huge business that is running behind it. Businesses run the world, and they play a pivotal role in boosting the economy of the country.
There are two types of business – entrepreneurship and small business.
Key Takeaways
- Entrepreneurs innovate and create new opportunities, while small business owners manage existing businesses.
- Entrepreneurship involves higher risks and potentially higher rewards, while small businesses focus on stability and steady growth.
- Entrepreneurs disrupt industries, whereas small businesses serve local communities or niche markets.
Entrepreneurship vs Small Business
Entrepreneurship is a business strategy that involves observing and identifying the needs of society and providing innovative solutions for them. It is a risk-taking process. Small businesses focused on providing goods and services that are already existed in the market to generate stable revenue.
Entrepreneurship includes individuals or groups of individuals called entrepreneurs that are ready to change, invent and innovate the existing system and bring forth products and services that were not present in the existing system.
Entrepreneurship includes high-risk takings. The focus in entrepreneurship is not solely on profit-making but the mass acceptance of the business idea.
On the other hand, small businesses do not work on new ideas but rather build a model on existing ideas. The main focus of a small business is on profit-making.
They do not work on any innovative or creative ideas and do not take high risks. Hence the returns on small businesses are also lower.
Comparison Table
| Parameters of Comparison | Entrepreneurship | Small Business |
|---|---|---|
| Types | Home-based owners, online business owners, and serial entrepreneurs | Sole proprietorship, partnership, corporation, and Limited Liability Company (LLC) |
| Objective | To make maximum profits from the market | To introduce unique and creative products and goods in the market |
| Owner | Individuals or groups of individuals | Individuals or groups of individuals |
| Risk Appetite | High | Low |
| Business expansion | Limited | Fast and rapid |
What is Enterpreneurship?
Entrepreneurship refers to the creation of new ventures, values, or businesses. Innovation and change in the existing system with the integration of risk are involved in entrepreneurship.
Entrepreneurship involves the processes like designing, launching, collaborating, managing and operating a new business or venture.
Entrepreneurship begins as a small business and later pursues as it experiences growth.
Entrepreneurship is the basis of many successful companies. The individual or group that starts entrepreneurship is termed an entrepreneur.
The vision aims and an entrepreneur’s idea determines and dictate entrepreneurship’s growth and success.
The biggest companies like Walt Disney, Google, Amazon, Apple, and Harley-Davidson grew successful due to the creative vision of their entrepreneur.
The risk appetite of entrepreneurship is high. They are constantly looking for new opportunities and are ready to change and grow the business.
Entrepreneurship has an idea and wants to bring about creativity and innovation and sell unique products and services.
Entrepreneurship does not focus extensively on profit-making. The objective of entrepreneurs is diverse and broad.
Entrepreneurship has a clear vision of expansion and growth and works on every new opportunity. Entrepreneurship has the potential for extreme growth and success.
The success rate of entrepreneurship is considered high. Entrepreneurship revolves around a specific opportunity, and the business is created from it.
What is Small Business?
A small business is an operation of a business on a small and limited scale. Small businesses are owned and managed by individuals or groups.
Every small business work on a different principle which depends upon the individual owner. Every small business aims to earn profit.
Small businesses stick to a specific niche and cater services and products related to that niche.
Partnership and proprietorship are the two most common and popular types of small businesses. In partnership, two or more individuals can share the business’s liabilities and profits.
The share may or may not be equal depending upon the contract between the parties. Multiple partners help in the venture capital of the business.
While in proprietorship, an individual runs, operate and owns the business. He/she is liable for every loss and profit.
The owners of small businesses are content with the niche and type of business. They do not explore or look forward to new opportunities.
The expansion of small businesses remains small or medium throughout. A small business may have employees less than 50. The owner or individual controls every decision of a small business.
The sales volume of small businesses is relatively low. Since the size is small, the capital outlay is smaller. Small business owners are self-employed.
They do not want to change or bring evolution to their products and are content and satisfied in their current state.
Main Difference Between Entrepreneurship and Small Business
- Entrepreneurship constantly accepts and explores new opportunities, while small business does not.
- Entrepreneurship does not extensively focus on profit-making but rather on innovation, unique and creative products and services, while small business extensively focuses on profit-making and not on innovation.
- The business expansion in entrepreneurship is rapid and fast, while the business does not expand rapidly in small businesses.
- Entrepreneurship is willing and able to take high risks, while small businesses cannot.
- The returns from entrepreneurship are bigger while the returns from small businesses are smaller.
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